American Employee at Embassy in Athens Arrested on Spy Charges

By DOUGLAS JEHL,

Published: May 4, 1993

WASHINGTON, May 3—
An American employee of the United States Embassy in Athens has been arrested in Virginia on charges of selling highly classified information to contacts suspected of being Greek military officers, United States officials said today.

While the details have not been made public, the officials said the case involved the sale of more than 240 documents containing American assessments of Greek military capabilities and Greek intentions in the former Yugoslavia.

A senior American official said that the case had caused considerable unease and that the State Department was assessing how much information the arrested man, Steven Lalas, may have disclosed.

Mr. Lalas, 40, a communications officer, was arrested Friday by agents of the Federal Bureau of Investigation. He appeared briefly today before a Federal magistrate in Alexandria, Va.

The State Department said Mr. Lalas, a career employee, had been hired in 1983 and assigned to Istanbul, Turkey, and Belgrade, Yugoslavia, before Athens.

Mr. Lalas is of Greek origin, and one theory being pursued was that family connections might have motivated him to share information with Greek officials. But one senior official cautioned without elaboration that Mr. Lalas was "not necessarily" believed to have helped Greece.

A spokesman for the Greek Embassy here said today that his Government had heard nothing about the case. "At this point there is nothing to be said because it has nothing to do with the Greek Government," said the official, Nicolaos Papaconstantinou.

In describing the charges against Mr. Lalas, Administration officials said he was believed to have first shared classified information with his Greek contacts about 18 months ago, and was paid about $20,000.

The officials said Mr. Lalas believed his contacts to be Greek military officers, adding that investigators had no reason to doubt that view. But they suggested that it remained unclear exactly who the recipients had been.

Washington's views of Greek military capabilities and intentions would have been of considerable interest to Athens as Greek officials weighed the prospect that a spillover of ethnic violence from Yugoslavia could lead to a clash with Turkey.

The Administration officials indicated that Mr. Lalas had returned to the United States last week on his own accord, and had agreed to meet with Federal officials. Mr. Lalas is to be arraigned Wednesday in Federal court.